SAC Capital's Stake in Phelps Dodge (PD) Falls to 4.1%

In an amended 13D filing on Phelps Dodge (NYSE: PD), SAC Capital disclosed a 4.1% stake (8.4 million shares) in the company. This is down from the 5.1% stake (10.3 million shares) the firm disclosed in a past filing.

SAC said, "On January 20, 2007, option contracts on 1,778,000 shares of Common Stock held by certain of the Reporting Persons, which were previously reported, expired "out-of-the-money" pursuant to their terms. The Reporting Persons' have not changed their intention to vote against the proposed FCX transaction, as previously reported."

SAC Capital Opposes Phelps Dodge (PD) Merger with Freeport-McMoRan (FCX)

In a 13D filing this morning on Phelps Dodge (NYSE: PD), 5.1% holder (10.3 million shares) Steven A. Cohen / SAC Capital said the merger agreement with Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) undervalues the company and they plan to vote against the proposed transaction.

From the 'Purpose of Transaction' section of the filing:

The Issuer announced on November 19, 2006, that it had entered into a definitive agreement to merge with Freeport-McMoRan Copper & Gold Inc. ("FCX"). The Reporting Persons believe that the terms of the proposed FCX transaction would not provide full and fair value to the Issuer's shareholders and would deprive them of their ability to maximize the return on their investment. The Reporting Persons believe that the proposed FCX transaction offers few, if any, synergies to the combined operation, and would use the Issuer's balance sheet to fund the purchase in what is essentially a public recapitalization that would create disproportionate value for FCX shareholders at the expense of the Issuer's shareholders. In addition, the Reporting Persons believe there is unrecognized long term value that the Issuer's shareholders would forego if they sold their shares at FCX's proposed terms. Accordingly, the Reporting Persons currently intend to vote against the proposed FCX transaction.

SAC Capital's Latest Adjustments

Another 13F filing of interest. This one from one of the world's largest and most well respected hedge funds SAC Capital, which is run by Steve Cohen.

SAC is not a buy and hold type investor, so while interesting the stocks may not be good piggybacks:

Some positions closed out: FPL Group Inc. (NYSE: FPL) (sold 1.9M shares), Emulex Corp. (NYSE: ELX) (sold 2.3M shares), Laidlaw International Inc. (NYSE: LI) (sold 1.3M shares), Source Interlink Companies Inc. (Nasdaq: SORC) (sold 2.5M shares), Level 3 Communications Inc. (Nasdaq: LVLT) (sold 5.8M shares).

Some new positons: NTL Inc. (Nasdaq: NTLI) (added 2.5M shares), Tyco International Ltd. (NYSE: TYC) (added 1.45M shares), Pentair Inc. (NYSE: PNR) (added 1.3M shares)

Some raised positons: Business Objects SA (Nasdaq: BOBJ) (added 2.85M shares), Alcoa Inc. (NYSE: AA) (added 2.6M shares), Phelps Dodge Corp. (NYSE: PD) (added 482K shares)

Some lowered position: Inco Ltd. (NYSE: N) (cut 1.5M shares), International Paper Co. (NYSE: IP) (cut 2.6M shares), Time Warner Inc. (NYSE: TWX) (cut 5.6M shares).